dividend yield

Definition

The yield a company pays out to its shareholders in the form of dividends. It is calculated by taking the amount of dividends paid per share over the course of a year and dividing by the stock's price. For example, if a stock pays out $2 in dividends over the course of a year and trades at $40, then it has a dividend yield of 5%. Mature, well-established companies tend to have higher dividend yields, while young, growth-oriented companies tend to have lower ones, and most small growing companies don't have a dividend yield at all because they don't pay out dividends.

Use dividend yield in a sentence

We would be getting what was called a dividend yield from the company and I did some research on it to see what it meant.

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Though the current dividend yield of the stock is 2% my actual yield based upon cost is far greater given the amount paid for the stock initially.

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